Dysfunctions of the basal ganglia (BG), such as Parkinson's disease, obsessive-compulsive disorder, and substance abuse, produce a number of motor and cognitive deficits. Nevertheless, current therapeutic interventions are mostly empirical, and their underlying mechanisms remain poorly understood. This reflects our poor knowledge about how different subdivisions of the basal ganglia interact so that their outputs can adaptively modulate the activity of neurons in their downstream structures. So far, almost all influential models of the BG have proposed that they are involved in choosing appropriate actions (action selection) and altering the tendencies to choose different actions according to their previous outcomes (reinforcement learning). Nevertheless, how these functions are implemented across parallel anatomical pathways through the BG remains crudely understood, because only a small number of physiological studies have systematically compared the activity of neurons across different subdivisions of the BG during behavioral tasks designed to probe specific cognitive processes. Studies proposed in this application will investigate how signals distributed in three major components of the BG contribute to action selection and reinforcement learning. Specifically, we will focus on the output nuclei of the basal ganglia, namely, the internl segment of the globus pallidus (GPi) and the substantia nigra pars reticulata (SNr), in addition to the external segment of the globus pallidus (GPe) that is believed to exert substantial influences on all other components of the BG. The comparison of neural signals across different compartments of the BG is essential for understanding the nature of intra- and trans- basal-ganglia signal processing, including the role of the direct and indirect pathways. In our experiments, we will first test whether estimates for the outcomes expected from alternative actions are dynamically and continually updated in the GPe and GPi/SNr during a decision-making task. In particular, whether they show enhanced activity related to unexpected changes in the expected outcomes will be tested. Second, we will also test whether the signals related to rewards and penalties are encoded differentially across different subdivisions of the BG. The results from these studies will lay important foundations for developing more efficient treatments for a number of mental disorders resulting from BG dysfunctions.